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Cost of NDSU president's house now $1.47 million

FARGO -- The price of the president's house at North Dakota State University has climbed to $1.47 million, more than 60 percent over the $900,000 the university's foundation was authorized to spend.

NDSU officials will bring the latest cost estimate to the Budget Section of the state Legislature on Tuesday and ask for permission to exceed the $900,000.

"I anticipate some very tough questions," said John Adams, NDSU vice president for finance and administration "There will probably be some legislators who don't care; there will be others who are really angry."

NDSU also will go before the state Board of Higher Education on Thursday with the same request.

Jim Miller, executive director of the NDSU Development Foundation, said in hindsight, officials should have handled it differently.

"We made a mistake by not going to the board and the legislative body earlier when we really needed to let them know about the increased amount," Miller said.

About three weeks ago, Miller said the house was running about 10 to 15 percent over budget, but at the time not all the costs were known.

This latest estimate is still a "moving target," but Miller said he doesn't expect it to go any higher.

It includes nearly $1.35 million in construction costs and about $90,000 in costs associated with the project, such as soil testing and site engineering fees.

Another $28,000 in contingency money is included in the final amount to cover anything unexpected that arises as the project is being completed.

Furnishings and appliances are not included in that amount.

President Joseph Chapman moved into the house at the beginning of the semester.

Sen. Ray Holmberg, chairman of the Budget Section, said legislators will want to know why the house cost more than they were told.

But because the project is funded with private donations and not taxpayer money, that should lessen some of the concerns, said Holmberg, R-Grand Forks.

Legislators authorize the spending, even though it's from private money, because the project is on state land and will become state property, Holmberg said.

It's unclear what would happen if either the Budget Section or the higher education board vote no to NDSU's request.

"The house is done basically, and it's over $900,000, and so we have to go back and ask permission," Adams said. "If they don't accept it, what do we do? I don't know."

Miller has said the severe winter and spring flooding prevented crews from working, resulting in overtime costs. Also, construction material costs escalated at the time they were approving work proposals and buying materials.

In addition, when NDSU got permission to spend up to $900,000, many decisions about the house had not been made, including the design and whether to tear down the existing president's house or remodel it, Miller said.

The University of North Dakota, on the other hand, was much further along in planning of its president's house because officials wanted it to be complete for a new president. Tim O'Keefe, executive director of the UND Foundation, has said the project stayed within budget.

The William C. and Jane B. Marcil Charitable Foundation pledged $1 million each to NDSU and UND to pay for the two presidents' homes. William Marcil is publisher of The Forum and chairman and CEO of Forum Communications Co. The Marcils were not involved with how the money was spent on either home.

To cover the rest of the project the NDSU foundation raised additional private money from members of its board of trustees. The project also received donated services and materials.